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More information about the digital shekel
Following the publication of the preliminary design document for the digital shekel last year, the Bank of Israel continued to deepen its work on the various aspects related to the possible issuance of a digital shekel. Today, the Bank of Israel is publishing a document reviewing progress in the Digital Shekel Project during 2025.
In recent years, the Bank of Israel has been advancing the “Digital Shekel Project” with the aim of examining the possibility of issuing a central bank digital currency (CBDC), which in Israel would be called the digital shekel. In March 2025, a preliminary design for the digital shekel system was published, and throughout 2025 the project team continued to examine in greater depth a range of issues required to support decision-making regarding the possible issuance of a digital shekel.
Today, the Bank of Israel is publishing a report to provide the public with a comprehensive update on the progress of the project’s work in 2025 and on how this work supports the Bank’s ability to make decisions regarding the possible issuance of the digital shekel. The document discusses four main topics in detail:
- Cost-benefit analysis: Based on the preliminary design, the team sought to assess the costs to the Bank of Israel, to system participants, and to the economy as a whole that could result from a possible issuance of a digital shekel, and whether those costs would be outweighed by the expected benefits. The team concluded that the benefits exceed the costs, and that issuing a digital shekel would be worthwhile from the perspective of overall economic welfare.
- The regulatory structure for the digital shekel system: In this context, the various risks expected to be associated with the activities of the system operator and its participants were analyzed, and the regulatory framework required to ensure the proper functioning of the system was discussed.
- Analysis of the feasibility of a “multipurpose digital shekel”: The preliminary design document stated that the digital shekel could operate both as a retail CBDC and as a system serving financial institutions, namely a wholesale CBDC. As part of this analysis, the characteristics and requirements of central bank money in its various forms were further refined, and the feasibility of a multipurpose digital shekel model was examined.
- Assessment of technological feasibility: Following publication of the preliminary design document, the Bank of Israel invited companies, technology experts, and academics to participate in a consultation process aimed at exploring potential technologies capable of delivering the functionalities required for the digital shekel system. The report describes the process that was undertaken and the main insights derived from it.
In addition, the report describes the in-depth analysis of the public responses received in relation to the preliminary design document, as well as the findings of a survey on businesses’ preferences regarding the use of the digital shekel, following research conducted in 2024 among private users.
In 2026, work on the project is continuing in preparation for a decision on whether to issue a digital shekel, with a focus on the following issues:
- Prioritization: The digital shekel described in the preliminary design document supports a very broad range of use cases, through a wide variety of system participants, and for a broad range of end-user types. The team is now examining whether there is a need to prioritize some of the capabilities and components described in the document in view of considerations such as timing, cost, risk management, and so forth. Such prioritization could be reflected either in a decision to issue the digital shekel with only some of the features initially included and to add further features in the future, or in a decision to limit the digital shekel so that it includes only some of the features described.
- Detailed design: In accordance with the prioritization process, work will begin on a detailed design, which will enhance readiness for the possible issuance of the digital shekel.
- Issuance roadmap: The team will formulate a roadmap describing the processes and activities that would be required within the Bank of Israel and beyond should a decision be made to issue the digital shekel.
The insights derived from these work streams and from additional technological experiments planned to be carried out—and indeed since the project was launched—will be consolidated into a recommendation document on whether to decide on issuing a digital shekel, to be submitted to the Governor of the Bank of Israel toward the end of the year.